Baycorp Accepts Commerce Commission Report

Thursday, May 25, 2006 - Baycorp Advantage’s New
Zealand Country Director, John Roberts, advised today that
the findings of a Commerce Commission investigation report
([1]May 2006) had been implemented in mid-2004.

In 2004,
the Commission investigated whether a fee of $5 introduced
by Baycorp Advantage in 2001 for debt collection agencies
lodging data on the Baycorp Advantage credit bureau
constituted a breach under s.36 of the Commerce Act
1986.

“Baycorp Advantage’s first responsibility is to
protect the accuracy and currency of data in our credit
bureau. Baycorp Advantage believed in 2001 and we still
believe there must be commercial incentives and
disincentives to encourage organisations to exercise proper
care and diligence, ensuring that data lodged with the
bureau is truthful, accurate and is kept up to date.

Our
response to the Commerce Commission concerns was to
institute a fee waiver for all compliant companies,” Roberts
said.

Baycorp Advantage introduced the fee waiver in
August 2004. The waiver was developed in conjunction with
Associated Credit Bureaux NZ Inc (ACB) and set minimum
standards for debt collectors loading defaults.

Fees were
waived for all debt collectors who agreed to meet certain
technical and data quality standards.

Baycorp Advantage
advised the Commerce Commission of its change in practice in
2004. The Commission’s 2006 report acknowledges this and
notes the change of practice.

As custodian of sensitive
personal credit information, Baycorp Advantage incurs costs
in the management of the confidential data provided to the
bureau by various parties. These costs rise
disproportionately when incorrect or poorly maintained data
is entered, as Baycorp Advantage has legal obligations as to
accuracy of data.

“Bureau users who lodge faulty data or
fail to update data are a major risk to the integrity of the
credit data-base and a major cost to Baycorp Advantage.
There must be commercial incentives to encourage people to
do the right thing. We will continue looking into this and
may need to examine user-pays systems for non-compliant
clients,” Roberts concluded.

“If we need to review our
practices further following the release of the Commerce
Commission’s investigation report, we will” Roberts
confirmed.

Baycorp Advantage will keep the Commerce
Commission advised of any future user-pays proposals prior
to introduction.

Roberts also advised that as at 1 April,
2006 debt loading fees could be waived across the board for
businesses signing onto the revised subscriber agreement
between Baycorp Advantage and its client group. The new
agreement places more stringent data quality obligations on
bureau users in line with the New Zealand Credit Reporting
Privacy Code issued by the Privacy Commissioner.

Looking
ahead, Baycorp Advantage believes that quality of data on
credit files will be vastly improved as consumers engage
more proactively with the management of their individual
credit file.

Since April 2005, consumers can obtain a
copy of their credit file on www.mycreditfile.co.nz Fees
are charged for express
delivery.

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